plumbers. all kidding aside, it's not the same job requirement. so, it's totally legitimate for the president to point this out. >> this comes as a new ad from president obama highlights the, quote, real people who were affected by bain capital, that private equity company that mitt romney ran for 15 years. take a look at that ad. >> makes me angry. those guys were all rich. they all had more money that they'll ever spend, yet they didn't have the money to take care of the very people that made the money for them. >> the other side former managing director at bain capital makes his case for the company's brand of free market capitalism in his new book which is called "unintended consequences, why everything you've been told about the economy is wrong." ed's given at least $1 million to the super pac that supports mitt romney. so nice for you to come and talk to us. >> thank you for having me. >> you were born in detroit, and you went to harvard business school, and you left to go to work for bain capital, and how much do you think you are worse off today, $100 million, give me a rough number. >> my middle-class parents told me not to talk about money. >> am i close? >> i'll let you guess. >> i'll go with $100 million or so, you ran bain company's new york office, you were managing director, that's the focus of the campaign obviously, we were showing clips of ads sort of going back and forth. part of the argument is people in some way, you know, like you private equity people are out of touch with the regular folks that president obama likes to put in their ads, regular people that did the work and weren't taken care of, do -- and i guess the thing by extension so is mitt romney. do ul think that that -- why is that not a fair argument? you say it's not true in your book. >> i think business leaders play a critical role in growing the economy and helping to create jobs and making the united states successful as it's been relative to europe or japan, the idea that they wouldn't make great leaders for our country is a little farfetched. >> but you think they make good job creators, because right now the focus of private equity and i guess has always been making money, not necessarily creating jobs, right? >> well, i think that it's half true that companies and bain capital work for investors, but more importantly, they work for customers and you can't be successful with investors if you aren't successful with customers. what you are doing is trying to make companies stronger and make them grow faster, and we created a lot of employment relative to jam and europe. >> you argue in your book that the superrich is very good for the middle-class. how is that so? >> well, i make an argument that the economy has changed significantly from the 1950s. that was the era of big business where we were capitalizing on the value of mass produced goods like cars, you need big companies to process them, the oil industry, you got to pave millions of miles of road, you have to put 250 million cars on the road. today two people can create instagram and $2 billion of value in a year. it's much more entrepreneurial economy than the 1950s where individuals didn't matter, and risk taking and the payoffs for risk take ig matter a lot more than the 1950s where funding large scale investment with risk averse savings, as opposed to equity which is much more needed and in is that right plsupply. you got to apply economics differently today than you would in the 1950s. >> there are some people who would look at the system today and would say as the rich get more and more rich, the middle-class as we well know is disappearing, so we've seen some of this tremendous increase in what the -- your average very super wealthy person is making and yet the middle-class is being constricted and shrinking. >> identify think that's a common misperception, the distribution around the median income is very tight and hasn't changed that much over time. if you really make a comparison to, say, europe, the risk takers as represented by the payoff for the successful risk takers, the 1% if you will to use the slang, is much higher than it is in europe and japan. our risk takers are producing way more innovation, google, facebook, intel, microsoft, apple, i mean, the list goes on and on. and if you look at our middle-class relative to europe or japan i think at worse they're the same. and if you really dig into the numbers i think they're substantially better. for example, we created 40 million jobs since the 1980s, mid-1980s on a base of 100 million employees, that's a 40% increase in employment. europe and japan combined are in the 15% to 20% range. we brought 20 million immigrants in. we provided them jobs. we educated their children. we put tens of millions of people to work offshore. i think it's hard to make the argument that no other high-wage economy has done more for the working class and poor than the u.s. economy has. >> and there's people that looked at the income breakdown and talked about how the number of minorities and women how their wages have increased and if you look at white men, they have not, and they average the numbers out, and they take exception to the numbers in your book. my question would be this, you argue in the book, that there is sort of this level playing field and for many americans they feel it's not level. when you are talking about the super rich, it's not the risk taking, the deck is stacked against them, for example, in the form of lobbyists. i take lipitor, i pay much more than if i ran across the border to buy it, and that's because there's a lobby to ensure that it's brought in by the pharmaceutical corporations that want to make sure that prices are kept at a certain level. they have a connection with congress, it's not to help me or anybody else buying lipitor or anybody else in the middle-class they want to make sure that the pharmaceutical companies make a lot of money and keep their money, isn't that true? it's sort of an unfair, uneven playing field. >> we would all agree that we have to guard against any sort of rent seeking on the part of political interest groups when it comes to our government. we got to guard against it is every possible way we can and it's always a risk -- >> but that's lobbying in general. >> when you look at the micro you see a lot of lobbying going on back and forth between all sorts of different groups. when you step up to the macro, let's look at the two most important issues, taxes, in the u.s. the top 1% is paying a much higher percentage of the taxes than europe and japan, if you look at government services, europe is providing more government services and they are doing more by taxing the middle-class and not the top 1%. it's hard to make the argument for the two most important issues we're fighting about in this campaign season, taxes and jobs, it's hard to say that we are not doing it better than europe and japan. >> do you think that people talking about income inequality are wrong headed? mitt romney was asked about it by matt lauer of nbc. i'll play it and then talk to you on the other side. >> i think it's about class warfare, when you have a president encouraging dividing america on the 1% and the 99%, you have opened a whole new wave of the country which is intirely inconsistent on the one nation under god, i believe in the final analysis will reject it. >> are there no fair -- >> do you think that that's true that the conversation about income inequality is really one where it's the 99%, the people who are not in the superrich category are really just envious? >> well, i wouldn't use the word envious. i guess i think the best of people, so i don't want to think -- i don't like to think that. but i would say this, that if you don't see that the economy has changed from the 1950s to where it is today, very much based on risk taking and innovation, you scratch your head and wonder why income inequality has increased and if you don't see the reason why then you start to come up with other reasons and you say, well, geez, maybe it's a fortuitous aligning of the stars which has allowed the top 1% to get more income today than they would have in the past. you don't see the underlying economics. >> or maybe there's a sort of nonlevel playing field, that the wealthier are allowed to become wealthier -- i think people feel this way, there are certain regulations in congress, sometimes it's the tax system, that help the wealthier keep their money and make more middle whereas the middle class at the same time feel they are being squeezed and they are not helped by the very congress that they worked to elect? >> and i gave you a different interpretation, in most cases we find as a whole the top 1% here is earning and producing more of the united states than they are in europe and japan. we have a very rich set of unrealized investment opportunities. i go back to google, facebook, intel, you name it, and all of that innovation has come from the united states. europe and japan stand in stark contrast. and so when you see this difference between today and the 1950s, i think you're really asking the question which is do we need these high payoffs to motivate the risk taking that's producing innovation and when we look at the micro example when state lotteries go up, for example, we know that people start buying a lot of tickets. when internet values rose in 2000 we know a lot of people walked away from their jobs to create jobs. and we know when the real estate prices rose in 2006, 2007, a lot of entrepreneurs started working on fixing up real estate to try to make money, so we know the payoffs do motivate increased risk taking and if the u.s. -- if europe and japan had produced a similar level of innovation with much lower payoff we certainly wouldn't be having this debate about whether the payoffs are necessary. but we stand in stark contrast to europe and japan. >> you're arguing for the 1% in a world that's having kind of i think -- a country in an election is having a fight over the 1% versus the 99%. a lot of people don't see him on wall street, three don't want to see the protesters on occupy wall street. they don't think it's a good thing to be part of the 1%. do you think his book could hurt him politically? >> i think there's always a risk. coming on tv, it's a risk for bain, it's a risk for mitt, it's a risk for me. but i can tell you this when serious economists have read my book, on the left and the right, and nuri ouriel roubini, he agr it's seriously and thought provoking and well considered explanation of the economy even though he disagrees with it. >> and the political question, i get you. thank you for joining us. >> thank you for having me soledad. let's get to the top stories. >> a woman undergoing a mental evaluation this morning after causing a body bomb scare on an international flight. the woman was on board a us airways' flight from paris to north carolina yesterday when she claimed to have a device surgically implanted in her body. claimed this in a note she gave to a flight attendant, flighter jets got scrambled and the flight was diverted to bangor, maine, where the woman was taken off that plane. >> they called for a doctor and the doctor took her back to the back of the plane. she came up again and went back to the back of the plane and the pilot came back with her and the next thing we knew they were saying we were making a stop and we were down within minutes. i've been flying my whole life, i've never been from that altitude to landing that quickly. >> federal officials say doctors on board checked her out, found no recent scars. they say they did not pose a threat and, again, psych evaluation under way. morgan stanley subpoenaed over the facebook ipo, the state of massachusetts issuing that subpoena after reuters reported that morgan stanley shared a negative revenue outlook with its clients right before the social networking company went public. morgan stanley was the chief underwriter for the ipo and insists it followed all the required procedures. are we about to fall off a fiscal cliff? the congressional budget office says that's exactly what will happen if trillions of dollars in tax hikes and spending cutting take effect as scheduled next year. they say if congress doesn't act, the u.s. economy will be pushed back into recession. that includes letting the bush tax cuts expire, the alternative minimum tax exemption for the middle-class and the trillion dollars of spending cuts and pay cuts for medicare doctors. egypt's future being watched closely by the u.s. and israel this morning. egyptians are heading to the polls right now to elect their first president since the fall of hosni mubarak and the 30 years of dictatorship, it's really the first free elections in the country's 5,000 yeerms of years. we're about to tell you the winner of "dancing with the stars." >> donald and pita! >> i didn't give you much time to turn away, did you, football star donald driver takes home the crystal ball trophy, he and his partner wowed the judges with their country-themed freestyle scoring a ten. the green bay packers wide receiver was a bit of an underdog heading into the final. the judge favorite welsh opera singer katherine jenkins came in second. i'm not a breathless follower of "dancing with the stars." >> would you do that show? >> absolutely not. >> really? i thought you would say absolutely. i would do it. >> seriously? you have to be away from your family. >> you wouldn't do "dancing with the stars" because you might get shinsplints? >> i don't like pain, soledad. i don't like pain. >> just for the record, i'd do it in a hot second. yeah, i can dance, come on! thanks, christine. still ahead on "starting point," a man, a zebra and a mccaw walk into a bar, actually there's no punch line, that really happened. it's one of the strangest dui stops ever to tell you about. that's coming up. and what exactly happened in the prostitution scandal in south america? more details being revealed as some of the secret service agents are fighting to get their jobs back. senator ron johnson is investigating, he'll join us list. from his play list, that's george harrison "while my guitar gently weeps." we're back right after this. ♪ every mistake we must surely be learning ♪ neutrogena® ultra sheer provides unbeatable uva uvb protection and while other sunscreens can feel greasy ultra sheer® is clean and dry. it's the best for your skin. ultra sheer®. neutrogena®. 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[ kyle ] it's like we're connected. no we're not. yeah, we are. no...we're not. ♪ the allstate value plan. dollar for dollar, nobody protects you like allstate. welcome back, everybody. this morning four secret service agents dismissed during that prostitution scandal in colombia are fighting back. they say they're being used as scapegoats and they don't deserve to lose their jobs. the four agents are among 12 accused of having paid for sex while prepping for president obama's trip to colombia and they say they're take the fall for things that were long tolerated in what people would call the secret circus. the secret service director will be testifying before the homeland security committee. wisconsin senator ron johnson is on that committee and he joins us from capitol hill this morning, good morning, sir, thank you for join us. what do you want to ask the secret service director? >> i want to find out how pervasive this kind of culture and at teed titude is in the se service. it's one of the most respected agencies in our government. they've done phenomenal work. i think director mark sullivan is highly respected here in washington. i've had a meeting with him. he seems very sincere. wants to get to bottom of this thing, the revelations this morning, again, would indicate it may be a little bit larger cultural problem than what was first indicated. >> do you see it, then, as a failure of his leadership specifically? >> we'll have to investigate this. i think we're getting our arms around this particular incident that occurred in cartagena, colombia, over the course of five days, three separate incidents, so he's getting to the bottom of that. but with the new revelations it's too early to tell. we just might need a totally separate investigation from a totally independent body. >> his remarks we know because he sent us a preview of his remarks. he'll say this, at the time the misconduct occurred none of the individuals involved in the misconduct had received any sort of protected information, sensitive security documents, firearms, radios, or other security related equipment in their hotel rooms. in other words, really, ultimately there was nothing at risk. is that a good enough answer for you? >> no, it isn't. because, i mean, the problem really is when agents expose themselves and become vulnerable to coercion, blackmail, they just become vulnerable and that's what's so incredibly important. there are plenty of rules already in place that should have prevented this. anytime a secret service agent comes into contact with a foreign national outside of his duties, he should be reporting that immediately when he returns to his, you know, home base and that didn't occur in this case either. so, we really need to get to the bottom, is it a cultural problem, is it more pervasive. it's a very serious issue. >> as i was mentioning in the introduction to you, some are saying it is cultural, and before any sort of big deployment what you could do is go out and act a little bit crazy, it's cultural, and they are fighting back for their jobs. do you think they deserve their jobs back if, in fact, it was culturally okay within the secret service? >> i would say no, but we need to find out whether it is part of the culture. you know, i heard a little bit, it's a little bit more of an attitude, you know, what goes on in las vegas stays in las vegas. that's just totally unacceptable and, you know, what i want to do is we need to get to the bottom of this thing. not to go on a witch hunt but really find out is the secret service secure so that we certainly know, you know, the people they are protecting are secure. again, it's a very serious situation here. we need to get to the bottom of this thing. and what i want to make sure is that we don't have a drip, drip, drip, you know, of incident after incident coming over in the next number of months. we need to get to the bottom of this now. find out what the problem is. fix it and move on. >> or maybe what goes on in cartagena, stays in cartagena, was the philosophy. thank you for joining us, senator ron johnson. >> appreciate it. still ahead at "starting point" a groom jilted at the altar decides to sue the bride-to-be. there they are, headed in to talk about that and much more. and, by the way, roland's play list, parliament, wow! 22 minutes in we're playing parliament. you're watching "starting point," back in a moment. ♪ people with a machine. what ? customers didn't like it. so why do banks do it ? hell